With the fast-rising popularity of artificial intelligence (AI), stakeholders across multiple sectors are quickly leveraging it for efficiency and enhancement of their operations.
Touching on the implementation of AI in finance, particularly in tax fraud detection, AI strategist Oladiipo Oladepo explained how AI is already being used in countries like the United States to detect suspicious tax filings, recover lost revenue, and improve efficiency in public finance systems, and how other countries, including Nigeria, could follow suit.
“Machine-learning models are excellent at detecting patterns across noisy data. Connect them to a revenue agency’s structure, and these models would begin risk scoring in real time. Typically, they can carry out things like anomaly detection, graph analytics, and self-enhancement,” Oladepo stated.
Despite the established efficiency of AI in the fight against tax fraud, with the US reportedly saving close to $4 billion in 2024 alone, the AI strategist called for caution in the deployment of machines and algorithms.
“Because machines and algorithms can go too far, there are valid concerns about the data privacy issues associated with AI, especially as it has the power to widen the coercive power of revenue agencies. Therefore, agencies must have the guardrails of supplying only useful data to the software, ensuring articulate explanation on decisions, and synergising with human efforts,” Oladepo added.
As Nigeria deliberates tax reform bills amid calls for an improvement in the fight against tax fraud, the expert urged the country, among others, to consider enlisting AI to achieve better results while taking cues from the United States and leaving room for public-private collaboration to modernise processes and gain public trust.
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